(1888PressRelease)
July 26, 2007 - Those looking to invest in property in the Cape Verde islands may be pleased to hear that Smart Money Overseas (SMO), which provides mortgage solutions for those buying foreign property, is to extend its lending services to those buying in the islands.
Rates for the deal offered by SMO consist of a variable rate of 5.35 per cent for 30 years on interest only or repayment mortgages of €50,000 (£33,500) or higher to customers aged up to 75 buying on the islands of Sal and Santiago, Mortgage Solutions reports.
The move should be seen as a significant endorsement of the property market in the archipelago, but SMO managing director Kevin Fleury did add a caveat, saying: "Cape Verde is a great opportunity for investment, but as always, investors should tread carefully. When you invest overseas, do your homework.
"Investigate key indictors of a region's economic stability and prosperity, such as whether new companies are moving into the area, new airlines are operating into the local airport, and whether property is being sold as well as available for sale."
Such advice is, it should be emphasised, commonplace when it comes to overseas investment. The Foreign and Commonwealth Office has just issued similar advice to property investors irrespective of the country being invested in, varying from checking out the security situation to familiarisation with the health, tax and welfare situation for overseas residents.
On these issues, Cape Verde comes out well. Unlike many of its continental neighbours, the former Portuguese colony is a stable, two-party democracy, while the economy is going through a period of liberalisation with several privatisation programmes going on. This includes the privatisation of the notary and registry services on the island of Praia which has just been announced by the justice minister Jose Manuel Andrade, Macauhub reported today. In addition, the paper reports, there are plans to privatise the national airline TACV, although plans to do this have been delayed for the time being.
Moreover, the overall economy and standard of living on the islands is improving rapidly precisely because of the overseas investment coming in - itself a reason for the government and businesses to do everything to ensure nothing stands in the way of it continuing. Last week a release in the Open Press spelt out the current situation: Four major projects are due to be launched on the islands of Sal and Sao Vicente in the coming months. Moreover, tourism is growing at 22 per cent per year, flights are increasing and the locals are benefiting with low unemployment and an increase in the proportion of households supplied with electricity from 68 per cent in 2000 to more than 90 per cent now.
Mr Fleury's warning is wise enough, but Cape Verde shows good evidence of ticking the relevant boxes, with growing markets, a booming economy, more flights and stable government. In these circumstances, the SMO mortgage product for Cape Verde investors may prove rather popular.
###
